Bankinter: The main figures compared to the company’s own consensus for 1Q24 are: Revenues €1,481M (down 16.9% year-on-year; down 3.1% year-on-year) against €1,516M estimated; EBITDA €111M (down 50.9% year-on-year; up 15.6% quarter-on-quarter) fully in line with €111M estimate, giving an EBITDA margin of 7.5% for the group (7.2% in Stainless Steel and up 8.2% in High Performance Alloys). EBITDA of €53M (against €136M in 3Q 2022) against +€45M estimated. Net debt stands at €234m (from €340.7m at the end of 2023 and against €333m estimated).
Stainless steel production has decreased by 6% quarter-on-quarter, mainly as a result of the production stoppage in Acerinox Europe due to the strike. The rest of the factories increased their production in this period.
The outlook for 2Q2024 points to a slight improvement in EBITDA in 2Q2024 quarter-on-quarter. Stable outlook in the American market and high performance alloys, but no improvement in Europe. Moreover, the conflict continues in Acerinox Europe, where the IV Collective Bargaining Agreement is being negotiated. In Asia, Acerinox will stop production in Bahru in 2Q 2024, after the asset impairment carried out in 4Q 2023.
The aggregate figures are in line with the EBITDA outlook, despite the losses of €31M in Acerinox Europe, due to the market situation in Europe and the strike.
The evolution of financial debt remains positive and moderates at €107M down, which represents a DFN/EBITDA of 0.4x, despite having distributed a dividend during 1Q2024.
The US acquisition of Haynes International, specialised in special alloys, is on track and has already received shareholder and US antitrust approvals and is still pending further regulatory approvals. It is expected to be completed by 3Q 2024 and will increase its exposure to this business and the US market. The deal should deliver EPS growth from the first year.
We have a positive assessment of the financial performance despite the complex environment in Europe, which points to the strength of other markets, especially the US. However, we would be somewhat more cautious in the short term, as our assessment currently offers a somewhat limited potential (up7.7%).
These estimates will be revised after the company’s conference today.
